Climate and Energy: EU Policy and Regulation Update for 28 January 2026
January 28, 2026
As policy and regulatory landscapes evolve, this publication will provide insights to navigating emerging risks and opportunities in the energy transition. Read previous issues here.
- European Commission publishes Guidance on Net-Zero Industry Act
- ESAs publish joint Guidelines on ESG stress testing
- Delegated Regulation amending Taxonomy delegated acts published in official journal
- ESMA publishes second thematic note on clear, fair and not misleading sustainability-related claims
- ISSB publishes Staff Paper on the objective and scope of standard-setting on nature-related risks and opportunities
- Joint Bank Reporting Committee publishes 2026 Work Programme and recommendations on ESG Pillar 3 disclosures
- French banking and markets regulators publish priorities for 2026, including with respect to sustainability
- Lawsuit filed against RWE and Heidelberg Materials at German Regional Court
- Italy transposed CRD VI provisions on ESG risk
- The Italian Stock Exchange aligns its market rules with the European Green Bond Regulation
- Italian Parliament is examining the decree implementing the Environmental Crime Directive\
European Union/International
7 January 2026 [EU] – European Commission publishes Guidance on Net-Zero Industry Act
The European Commission published a Communication [available here], setting forth Guidance on the implementation of Article 28 of Regulation (EU) 2024/1735 (Net-Zero Industry Act).
The Net-Zero Industry Act establishes a framework of measures for strengthening Europe’s net-zero technology manufacturing ecosystem. To that end, its Article 28 lays down obligations for public authorities that create new schemes or update existing schemes that benefit households, companies or consumers in the purchase of net-zero technology final products.
The Communication sets out guidance on the scope of Article 28, the eligibility of schemes, as well as the assessment of the sustainability and resilience contribution of net-zero technology final products.
8 January 2026 [EU] – ESAs publish joint Guidelines on ESG stress testing
The European Banking Authority (EBA), European Insurance and Occupational Pensions Authority (EIOPA) and European Securities and Markets Authority (ESMA) (together the “ESAs”) have published Joint Guidelines on ESG stress-testing [available here].
The Guidelines provide National Competent Authorities (NCAs) with guidance on how to integrate ESG risks into stress testing methodologies across the EU’s financial system. They do not introduce new requirements for competent authorities, but build on the sectoral legislation (CRD VI and Solvency II) imposing procedural rules and assessment criteria on how NCAs perform supervisory stress tests.
The Guidelines will be translated into the EU’s official languages in the first quarter of 2026 and will be subject to a “comply or explain” procedure by the NCAs, which should notify their response two months after the translations have been published. The rules will then apply from 1 January 2027.
8 January 2025 [EU] – Delegated Regulation amending Taxonomy delegated acts published in official journal
Commission Delegated Regulation (EU) 2026/73 amending the Disclosures Delegated Act, Taxonomy Climate Delegated Act, Taxonomy Environmental Delegated Act as regards simplification of certain technical screening criteria for determining whether economic activities cause no significant harm to environmental objectives has been published in the Official Journal of the European Union [available here].
The Delegated Regulation sets forth exemptions and simplifies certain reporting requirements under Article 8 of Regulation (EU) 2020/852 (i.e., the Taxonomy Regulation). This includes:
- Exempting non-financial companies from assessing taxonomy alignment for their entire operational expenditures when it is considered non-material for their business model.
- Exempting in-scope companies from assessing taxonomy-eligibility for economic activities that are not financially material for their business. For non-financial companies, these are non-material if lower than 10% of the company’s total revenue, capital expenditure or operational expenditure.
- Streamlining the criteria for do no significant harm (DNSH) to pollution prevention and control related to the use and presence of chemicals.
- Streamlining KPIs such as the green asset ratio (GAR) for financial companies, with an option not to report detailed taxonomy KPIs for two years.
The Delegated Regulation will come into force on 28 January 2026, and applies from 1 January 2026.
14 January 2026 [EU] – ESMA publishes second thematic note on clear, fair and not misleading sustainability-related claims
The European Securities and Markets Authority (ESMA) published a second “Thematic note on clear, fair & not misleading sustainability-related claims” [available here] focusing on ESG strategies and on ESG “inclusions and exclusions”. The first such thematic note focused on ESG credentials [for more information, please refer to our previous edition, here].
The Thematic note reiterates the four guiding principles to help market participants ensure ESG claims are clear, fair, and not misleading, i.e., accuracy, accessibility, substantiation and currentness. Regarding ESG strategies specifically, the note concentrates on ESG integration and ESG exclusions, as these strategies are widely referenced in marketing communications directed to retail investors.
ESMA provides a series of “do’s” and “don’ts” in that respect, each illustrated by good and poor practices. For example, it advises not to use the term “ESG integration” as an umbrella term to describe a variety of ESG strategies (such as exclusions, best in class, etc.). It also recommends clarifying at which level ESG integration is done (e.g. at the level of security selection, security weighing, asset allocation).
15 January 2026 [International] – ISSB publishes Staff Paper on the objective and scope of standard-setting on nature-related risks and opportunities
The International Sustainability Standards Board (ISSB) published, ahead of its 28 January 2026 meeting, a Staff Paper on the approach and the anticipated scope for the standard-setting project on disclosures about sustainability-related risks and opportunities associated with biodiversity, ecosystems and ecosystem services [available here].
ISSB Staff recommends that the ISSB proceed with nature-related standard-setting encompassing all nature-related risks and opportunities rather than limiting scope to a particular nature-related topic or industry, in alignment with the Taskforce for Nature-related Financial Disclosures (TNFD)’s approach.
Other recommendations include proceeding on the assumption that entities are already applying IFRS S1 and S2, or requiring disclosure of information about nature-related transition plans only if the entity has one in place, given the “nascent stage of entities implementing such plans”.
Because the ISSB staff considers that information on nature-related risks and opportunities is already addressed by ISSB standards, it does not currently see the need for standard-setting to create new requirements or elaborate on existing requirements.
19 January 2026 [EU] – Joint Bank Reporting Committee publishes 2026 Work Programme and recommendations on ESG Pillar 3 disclosures
The Joint Bank Reporting Committee (JBRC) published its Work Programme for 2026, setting out its main priorities and organization [available here], as well as a set of Recommendations to enhance semantic integration on ESG definitions [available here].
The Work Programme underlines a focus on the development and implementation of an integrated reporting system, including semantic integration and the development of common definitions and standards for the data that banks are required to report.
In that context, the JBRC Expert Group on Semantic Integration (EG SINT) released a set of Recommendations on the semantic integration of ESG Pillar 3 disclosures. These are based on the definitions contained in the Draft ITS on ESG disclosures, which the EBA provided for public consultation in May 2025 [available here]. There are 45 recommendations, aimed at aligning reporting between different concepts, prioritizing quantitative against categorical data, documenting assumptions, etc.
France
13-19 January 2026 [France] – French banking and markets regulators publish priorities for 2026, including with respect to sustainability
The French banking (ACPR) and markets (AMF) regulators have published their supervisory priorities for 2026, both referring to climate and sustainability challenges [available here for the ACPR, in French only, and here for the AMF]
The AMF targets the promotion of a more sustainable finance as a priority for 2026, through “simplifying sustainable finance regulations for better application”. It will pursue its action to combat greenwashing, but notes it will apply a pragmatic approach to enforcing rules, due to the recent changes in the sustainable finance regulatory framework.
The ACPR notes that the financial sector as a whole will need to anticipate long-term risks, in particular the climate change-related protection gap. One of the main priorities for 2026 is the reinforcement of governance and key functions, including the enhanced integration of sustainability challenges within risk governance.
Germany
22 December 2025 [Germany] – Lawsuit filed against RWE and Heidelberg Materials at German Regional Court
On 22 December 2025, 39 Pakistani farmers (supported by the NGO “European Centre for Constitutional and Human Rights (ECCHR)”) filed a claim against RWE and Heidelberg Materials at the Heidelberg Regional Court, made public by several specialized media outlets, on 20 January 2026.
The plaintiffs are demanding compensation for flooded fields and destroyed crops caused by the 2022 flood disaster in Pakistan, arguing that the two major emitters have contributed significantly to climate change through their decade-long CO2 emissions and are therefore partly responsible for the floods. The requested compensation is proportional with the defendants’ respective share of global CO2 emissions, amounting to over €1 million.
The Higher Regional Court of Hamm already ruled in 2025 that large CO2 emitters can be held liable for climate damage, but had not found sufficient evidence of potential future damage [see previous edition here]. With the current case, compensation is requested for damages that have already occurred.
The claim is both a fault-based claim for damages under Section 823(1) of the German Civil Code, and a compensation claim under Section 906(2) sentence 2 of the German Civil Code, known as a “neighboring claim” [see further here (German only) and here].
Italy
8 January 2026 [Italy] – Italy transposed CRD VI provisions on ESG risk
On 8 January 2026, the Italian Legislative Decree No. 208 of 31 December 2025 transposing the Sixth Capital Requirements Directive (i.e., 2024/1619/EU, CRD VI) was published in the Italian Official Journal [available here, in Italian].
The new decree introduces rules aimed to ensure that institutions established in the EU are able to systematically identify, measure and manage ESG risks. In particular, such rules provide for specific Bank of Italy intervention powers aimed at addressing and mitigating short-, medium- and long-term ESG risks.
16 January 2026 [Italy] – The Italian Stock Exchange aligns its market rules with the European Green Bond Regulation
The Italian Stock Exchange, Borsa Italiana, amended the Markets Regulation (and the related Instructions) [notice available here, in Italian], as well as the Multilateral Trading Facilities Access’ and EuroTLX Market – BondX segment’s Regulations [notice available here, in Italian], to align them to the changes introduced by Regulation (EU) 2023/2631 on European Green Bonds.
In particular, the amendments:
- Update the definition of Green Bonds to clarify that they include “European green bonds” or “EuGBs” issued pursuant to the European Green Bond Regulation;
- Adjust the admission documentation requirements by clarifying that the declarations and attachments usually required for Green Bonds, Social Bonds, Sustainability Bonds and Sustainability-Linked Bonds are not required where the securities are guaranteed by Italy or are issued or guaranteed by other EU Member States, or by international public bodies of which one or more EU Member States are members. In these cases, the relevant documentation will be submitted only if available, as third-party verification of the purpose of the issuance is not considered necessary.
The changes entered into force on 26 January 2026.
21 January 2026 [Italy] – Italian Parliament is examining the decree implementing the Environmental Crime Directive
The Italian Government submitted to the Chamber of Deputies (for review and opinion) a draft legislative decree implementing Directive (EU) 2024/1203 on the protection of the environment through criminal law [draft available here, in Italian].
The draft is intended to define the relevant offences and the applicable aggravating and mitigating circumstances and to ensure that penalties for environmental crimes are effective, proportionate and dissuasive, including as regards the liability of legal entities under Legislative Decree No. 231/2001.